Enhancing Harmonious Governance Policies for Improved Unity

European Court of Auditors - EuropaÜberwachungsgericht

Pathways for a United Cohesion Policy

A third of the EU budget is allocated to cohesion policy.EU auditors have highlighted lessons from the shortcomings found in the design and execution of this policy and the Recovery and Resilience Facility (RRF).The upcoming cohesion funds need to be more efficient and add more value to the regions of the EU.

Emphasizing strategic objectives and performance, flexibility in programming resources, swift execution, straightforward rules... These are vital components of the EU's cohesion policy that the European Court of Auditors (ECA) has been stressing for years. These aspects will contribute to making this flagship EU policy more effective and efficient, focusing on regional development and pursuing ambitious horizontal objectives. In an analysis document published today, the ECA draws lessons from the past to assist the EU in improving its cohesion policy in preparation for the new funding period starting in 2028.

With nearly 1,000 billion euros in funding from 1989-2023, combined with an additional 400 billion euros by 2027, the EU's cohesion policy is the world's largest regional development policy. Although the European Commission claims that this cohesion policy has helped lessen social and economic disparities within the EU, convergence has been uneven from one region to another. Auditors, in their analysis document, have delineated a series of factors that have affected the effectiveness of cohesion funds and present the lessons they've derived from the FRR. These should be taken into account when designing the next cohesion policy, due for implementation in 2028.

"Cohesion policy is the EU's main investment policy and is often viewed as one of the cornerstones of European integration. However, its execution falls significantly short of the ideal," claims Alejandro Blanco Fernandez, the Court's official responsible for the analysis document. "As discussions concerning the future direction of cohesion and the nature of the policy to be followed after 2027 have begun, our analysis provides crucial insights, drawing lessons from past policy and the FRR and suggesting courses for the design, implementation, management, and monitoring of the future policy."

Auditors note that over time, the EU's cohesion policy has had to cater to an increasingly extensive array of priorities and objectives. Given the considerable resources at its disposal, this policy has also frequently been employed to address extraordinary situations, such as the COVID-19 pandemic and the influx of refugees fleeing Ukraine in 2022. Auditors recognize that it is vital to be flexible with these funds, but they underscore that this further fragments the cohesion policy and risks diverting it from its primary goal: reducing regional disparities. It is crucial that the objectives of the future cohesion policy remain aligned with the development requirements of each region and continue to prioritize strengthening economic and social convergence.

Recent cohesion policy implementation has notably prioritized performance, with modest success. In this context, it may be worthwhile to consider supporting national and regional reforms aimed at making EU-funded investments more efficient and effective. Furthermore, auditors have repeatedly highlighted the importance of enhancing performance tracking and evaluation to facilitate evidence-based policymaking.

The issue of cohesion funds not being utilized (i.e., absorbed) in a timely manner has been raised by auditors. To address this, they once again stress the need for the legislative framework to be adopted promptly: this would accelerate programming, offer adequate pre-financing, and enable timely implementation of funds. They also note the potential benefits of synergies with other European instruments.

Auditors have consistently indicated that cohesion policy is controlled by rules that are often overly complex, which can lead to unnecessary administrative burdens and increased risks of error. The current assurance framework does not effectively mitigate these risks. They also argue that if a performance-based funding model were to be applied to cohesion policy, it would be essential to address the gaps identified in the Recovery and Resilience Facility, launched in response to the COVID-19 pandemic. Specifically, it is crucial to make sure that future cohesion funding is managed with sufficient transparency and that proper accountability measures are in place while also ensuring the effectiveness of mechanisms for recovering misused funds.

General Information

Cohesion policy is outlined in Articles 174 to 178 of the Treaty on the Functioning of the European Union. Its objective is to foster balanced development of the entire EU by strengthening economic, social, and territorial cohesion and reducing disparities between regions. It aims to rectify structural weaknesses and develop long-term resilience. The management of cohesion policy is shared between the European Commission and more than 400 national and regional authorities in the Member States.

The analysis document 04/2025, initially available only in English under the title "The Future of EU cohesion policy: drawing lessons from the past", is accessible on the Court's website. This document, which is not an audit report, compiles observations from previous audits, analysis documents, and opinions published by the ECA concerning various aspects of cohesion policy implementation, and establishes, wherever appropriate, a comparison with the conclusions drawn regarding the Recovery and Resilience Facility.

Contact:

ECA press office: [email protected]

Enrichment Data:

Overall:

The ECA's analysis showcases lessons learned from past cohesion policies and the Recovery and Resilience Facility (RRF) to inform future cohesion policy frameworks.

Key Lessons:

Including Past Lessons: The ECA advocates for integrating lessons learned from past implementation and fund allocation cycles to improve future policy effectiveness, ensuring better targeted and impactful investments.
Improving Accountability and Financial Management: The ECA emphasizes the importance of accountability, transparency, and sound financial management in cohesion policy. Lessons from the RRF underscore the significance of careful oversight and reducing waste and mismanagement.
Adapting to New Challenges: The review acknowledges emerging challenges and the need for cohesion policy to be flexible and responsive to these changing landscapes, including the need to deliver funds effectively in difficult circumstances.
Focus on Real Impact: There is a push for cohesion policy to place greater emphasis on tangible outcomes and socio-economic impact, rather than just expenditure and compliance. The experience with the RRF demonstrates the necessity for a results-driven policy to support sustainability and resilience.
Shaping a Better Cohesion Policy Post-2027: The ECA’s review aims to guide the development of the cohesion policy for the next multiannual financial framework, advocating for improved effectiveness, efficiency, and adaptability.

In summary, the ECA’s analysis calls for future EU cohesion policy to be more accountable, results-oriented, and adaptable, employing lessons from past implementation and the RRF to ensure that EU funds contribute effectively to reducing disparities and fostering recovery across member states.

The European Court of Auditors (ECA) suggests that the future design of EU cohesion policy should address the complex rules that often lead to administrative burdens and increased risks of error, as seen in the past.
The ECA emphasizes the significance of enhancing performance tracking and evaluation to facilitate evidence-based policymaking and improve the efficiency of EU-funded investments.
The next cohesion policy, due for implementation in 2028, should prioritize the objectives of each region and continue to focus on reducing regional disparities, while being flexible to address extraordinary situations such as the COVID-19 pandemic.